05-6398. Interpretive Rule Concerning Classification of Baseball-Style Caps With Ornamental Braid

AGENCY:

Customs and Border Protection, Homeland Security.

ACTION:

Final interpretive rule.

SUMMARY:

This document concerns the proper classification under the Harmonized Tariff Schedule of the United States (HTSUS) of baseball-style caps featuring ornamental braid located between peak and crown. In an effort to achieve uniformity in the classification of this commodity, Customs and Border Protection (CBP) has adopted as final a proposed interpretive rule whereby ornamental braid on a baseball-style cap, located between peak and crown in a width of 1/8 of an inch or greater, will render the cap classifiable in the HTSUS as “wholly or in part of braid.” Conversely, such braid in a width of less than 1/8 of an inch will result in a cap being classifiable in the HTSUS as “not in part of braid.”

DATES:

Effective Date: May 2, 2005.

FOR FURTHER INFORMATION CONTACT:

Theresa Frazier, Textiles Branch, Office of Regulations and Rulings, Customs and Border Protection, Tel. [phone].

SUPPLEMENTARY INFORMATION:

Background

This document concerns the proper classification under the Harmonized Tariff Schedule of the United States (HTSUS) of baseball-style caps featuring ornamental braid located between peak and crown. The specific issue presented is how wide ornamental braid on a baseball-style cap must be in order to render the cap classifiable in the HTSUS as either “wholly or in part of braid” or “not in part of braid.”

Baseball-style caps are classifiable in heading 6505 of the HTSUS which provides for, in pertinent part, “hats and other headgear, knitted or crocheted, or made up from lace, felt or other textile fabric, in the piece (but not in strips), whether or not lined or trimmed; * * *.” Within heading 6505, HTSUS, two subheadings differentiate between hats and other headgear that are “wholly or in part of braid” and those that are “not in part of braid.” See HTSUS subheadings 6505.90.50 and 6505.90.70 which provide for, in pertinent part, hats and other headgear “wholly or in part of braid,” and HTSUS subheadings 6505.90.60 and 6505.90.80 which provide for hats and other headgear which are “not in part of braid.” It is noted that hats and other headgear that are classifiable as “not in part of braid” carry a higher rate of duty than those that are classifiable as “wholly or in part of braid.”

In cases where baseball-style caps feature ornamental braid located between the peak and crown, the determinative issue is whether the braid impacts classification at the subheading level so as to render the cap classifiable as either “in part of braid” or “not in part of braid.” The 2004 HTSUS defines the term “in part of” in General Note 3(h)(v)(B), HTSUS, which states that “in part of” or “containing” means that the goods contain a significant quantity of the named material and that “with regard to the application of the quantitative concepts specified above, it is intended that the de minimis rule apply.”

The de minimis rule is applicable in customs practice principally in determining whether the presence of some ingredient in an imported commodity affects its classification. See Ruth F. Sturm, A Manual of Customs Law 182 (1974). The rule stands for the proposition that:

Certain amounts of an ingredient, although substantial, may be ignored for classification purposes, depending upon many different circumstances, including the purpose which Congress sought to bring about by the language used and whether or not the amount used has really changed or affected the nature of the article, and of course, its salability.

Varsity Watch Company v. United States, 43 Cust. Ct. 1, C.D. 2094 (1959), appeal dismissed, 47 CCPA 173 (1959).

On August 27, 2004, a document was published in the Federal Register (69 FR 52726) in which Customs and Border Protection (CBP) solicited public comment as to the appropriateness of a proposed interpretive rule whereby ornamental braid on a baseball-style cap, located between peak and crown in a width of 1/8 of an inch or greater, will render the cap classifiable as “wholly or in part of braid.” Conversely, CBP proposed that such braid in a width of less than 1/8 of an inch would result in a cap being classifiable as “not in part of braid.” The proposed standard was based on several previously issued Headquarters Rulings Letters which had adopted the 1/8 of an inch standard for purposes of applying the de minimis rule to this type of commodity. The proposed interpretive rule set forth in 69 FR 52726 was offered as a means of ensuring the uniform application of the de minimis rule and providing consistency in the classification of baseball-style caps with braid trim.

Discussion of Comment

No comments were received in response to the solicitation of public comment in 69 FR 52726.

Conclusion

Upon due consideration, CBP has decided to adopt as final the proposed interpretive rule published in the Federal Register (69 FR 52726) on August 27, 2004.

Drafting Information

The principal author of this document was Ms. Suzanne Kingsbury, Regulations Branch, Office of Regulations and Rulings, Customs and Border Protection. However, personnel from other offices participated in its development.

Dated: March 28, 2005.

Robert C. Bonner,

Commissioner, Bureau of Customs and Border Protection.